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|JCDecaux Announces its Results for the Full Year 2002|
19 March 2003 – JCDecaux SA (Euronext Paris : DEC), one of the world's leading outdoor advertising companies and the largest in Europe, announced today strong results for 2002, supported by sound organic growth in a year in which market conditions remained challenging.
Street Furniture revenues increased by 5.3 % to €840.3 million in 2002, representing 53.3% of Group revenues, a good performance given the difficult advertising market conditions and reflecting the increasing use of street furniture advertising. Adjusting for currency, organic revenue growth was also 5.3%. Across Europe, established countries such as France and Germany performed well, and growth was particularly strong in the UK, Belgium, Netherlands and Sweden. Business was strong in the US, with shopping mall sales increasing significantly.
Overall, the Group won 85% of all tenders for Street Furniture contracts (renewals, mainly in France, and new contracts) that it competed for in 2002.
Billboard revenues rose 7.6% to €442.6 million in 2002. Adjusting for currency, organic billboard revenues grew by 2.8%. Geographically, business continued to be strong in the UK and in Central Europe, while it stabilized in France and Belgium.
Transport revenues decreased by 11.6% to €294.8 million in 2002. Adjusting for currency, organic revenues declined by 13.0% compared to last year. Transport recorded positive growth in Scandinavia, Spain, Portugal and Italy but continued to be weak in the United States and in France, where airport advertising remained depressed throughout 2002.
Street Furniture recorded a significant improvement in EBITDA, which increased by 11.0% year-on-year to €340.3 million in 2002, producing a strong EBITDA margin of 40.5%. The improvement in EBITDA was primarily due to the division's strong revenue generation combined with reduced operating costs. The United States, along with France, the UK, Germany and Sweden, were the main contributors to EBITDA growth in 2002.
Billboard EBITDA increased by 15.8% to €55.4 million in 2002, leading to an improved EBITDA margin of 12.5%. Improvement in Billboard EBITDA reflected a reduction in operating costs, as well from the benefits of the Company's upgrade of its Billboard network in the UK and in France. JCDecaux's leading position in the European outdoor market was a significant factor behind its success in securing major pan–European contracts with top multinational advertisers, including the 22-country commercial alliance with Unilever announced last year.
In Transport, EBITDA decreased by 58.4% to €9.6 million, down from €23.1 million in 2001 but significantly up from the €0.2 million reported at the half year, reflecting significant operating cost reductions in the business. Transport EBITDA margin was 3.3% in 2002, compared to 6.9% last year, primarily reflecting the decrease in airport advertising revenues.
Operating income (EBITA)
Adjusted net income (Group share) before goodwill amortization and exceptional items increased by 6.3% to €92.4 million in 2002, compared to €86.9 million in 2001.
Free cash flow
Commenting on the results, Jean-Charles Decaux, Chairman of the Executive Board and co-Chief Executive Officer, said:
“In market conditions which remained challenging, the Group has performed well and exceeded previous expectations. Revenues, net income and free cash flow have all improved, with earlier investments producing clear benefits. This demontrates that the Group has the right assets, the right people and the right strategy to continue to grow.
“2003 will be challenging and it remains difficult to predict the outcome for the full year given the current uncertainties. Nonetheless, we expect to deliver positive organic growth (adjusted for currency) in revenues in the first quarter of 2003, despite slightly negative growth in Street Furniture, reflecting lower rate increases and the fact that the large contracts recently won will not start generating significant revenues until 2004.
However, we remain confident that, if market conditions do not deteriorate further, we can achieve organic growth of around 2% in Street Furniture for the full year 2003.”